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How nearby desalination plant will affect Newport-Mesa

Coastal Commission could approve Poseidon project in neighboring H.B.

By Jill Cowan

November 9, 2013 | 2:41 p.m.

As they await what could be a final green light for a controversial desalination plant in neighboring Huntington Beach, Newport Beach and Costa Mesa water providers have found themselves navigating something of a Catch-22.

On one hand, local water purveyors said they support the development of reliable, local water sources, as competing interests statewide jockey for an ever-dwindling water supply. After all, some argue that that turning sea water into potable water could one day serve as a part of a long-range solution for a looming California water crisis.

But on the other, they added, individual agencies are hesitant to commit to buying water that — at least for awhile — will be considerably more expensive than the water from their current supplies.

"We all have to look at what ... water reliability is going to cost us," said George Murdoch, the city of Newport Beach's utilities general manager. "How much is the public willing to pay for that reliability? I don't have an answer for you."

The California Coastal Commission is set to consider the desalination project, which would take in ocean water and transform it into potable freshwater, at its meeting next week in Newport Beach.

Commission staff has recommended approving the project, provided the plant's builder, Connecticut-based Poseidon Water, takes a number of steps to mitigate the plant's effects on the surrounding environment.

Some of those measures, however, could kill the project, according to Poseidon spokesman Brian Lochrie.

So the company will ask the commission to "approve the project as proposed and institute firm but fair measures" to counteract the "insignificant environmental impacts" the plant may have.

Another aspect of the project commissioners are expected to explore is whether individual agencies will buy water from the plant once it's up and running.

And therein lies the dilemma, officials said.

Murdoch, who has followed the desalination plant through the debate that's swirled around the project for nearly a decade, said that about 70% of Newport Beach's water supply comes from ground sources.

That water, which is purchased through the Orange County Water District, costs about $425 per acre foot, he said. An acre foot amounts to 325,850 gallons.

The other 30% of the city's water is imported from outside the county, through the Municipal Water District of Orange County, and costs almost $1,000 per acre foot.

The most recent estimates say that water from the plant would cost about $1,600 per acre foot, Lochrie wrote in an email.

As a result of that higher price, said Karl Seckel, assistant general manager of MWDOC, "We're not necessarily ready to sign up and commit to the project today, but we do think it needs to be fully evaluated ..."

John Kennedy, an Orange County Water District official, said that in some respects, the success of the project, and agencies' willingness to buy the desalinated water could come down to timing.

"It's very possible that in 10, 20, 30 years, ocean desalination supplies may become less expensive than imported supplies," he said. "We have this opportunity right now, so do you say you want to wait a few years?"

Seckel said arrangements where the desalinated water is "melded" into the overall water supply or the desalinated water is subsidized in part by federal or state grants are also on the table.

The city of Newport Beach and Mesa Water District, which supplies water to much of Costa Mesa, have both officially expressed interest in purchasing water from the plant — in 2008 and 2009, respectively — but have said they don't currently need the water.

Mesa gets all of its water from local sources, district board President Jim Fisler said in an emailed statement.

But the Poseidon project could involve Mesa Water sharing one of its existing pipelines with the desalination plant. Lochrie wrote that the company also may build a distribution pipeline in Costa Mesa, which would require approval from the City Council or Mesa Water.

A Mesa Water spokeswoman directed questions about the agency's position on the desalination plant to a frequently asked questions page online.

According to that document, "there are no current discussions regarding changes in ownership or use of [its OC-44 main water pipeline]."

However, the document continues, such an arrangement could benefit Mesa Water customers, if Poseidon footed the $60-million bill to replace an aging pipeline, and if Mesa Water was paid for use of the line to supply other Orange County agencies.

"Should a proposed route be formally presented to Mesa Water, the Mesa Water Board will consider the options in a public hearing that includes opportunities for public input," it says.

Ultimately, Murdoch said, he sees local agencies waiting to see how discussions play out at the commission meeting next week.

"What [Poseidon needs] to do is sharpen their pencils and be competitive with the import supplies," he said. "We all want to keep our costs to a minimum."

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